PAGE:1 of 6 / REPLACES POLICY DATED: 1/1/04, 4/30/05 (GOS.BILL.007)
EFFECTIVE DATE: March 6, 2006 / REFERENCE NUMBER: REGS.BILL.007
SCOPE: All Company-affiliated hospitals procuring, utilizing and/or billing for investigational devices. Specifically, the following departments:
Business Office Medical Staff
Administration Revenue Integrity
Registration/Admitting Health Information ManagementService Centers Finance
Reimbursement Utilization/Case Management
Materials Management Quality Management
Supply Chain Operating Room Director
PURPOSE: To establish guidelines for billing investigational devices and related services in accordance with Medicare requirements.POLICY: Investigational devices which are classified as Category A devices by the Food and Drug Administration (FDA) are not covered by the Medicare Program. Medicare coverage of services related to the provision of Category A devices is as follows:
- Services related to the provision of Category A devices where the clinical trial does not diagnose, monitor or treat an immediately life-threatening disease or condition are not covered by and must not be billed to the Medicare program.
- Services related to the provision of Category A devices where the clinical trial diagnoses, monitors or treats an immediately life-threatening disease or condition are covered by and may be billed to the Medicare program when all of the following conditions have been met:
- approval has been granted by the hospital’s Institutional Review Board (IRB);
- services are furnished to a patient who is participating in an FDA-approved clinical trial; and
- proper notification has been submitted to the hospital’s Medicare Fiscal Intermediary (notification of use provided).
- approved by the hospital’s Institutional Review Board (IRB);
- granted an FDA-approved Investigational Device Exemption (IDE) and Category B status;
- furnished to a patient who is participating in an FDA-approved clinical trial; and
- submitted to the hospital’s Medicare Fiscal Intermediary (notification of use provided).
Note: Medicare will cover services related to a condition or complication that arises as a result of the use of a non-covered Category A or Category B device.
The facility may accept an investigational device from a manufacturer or research sponsor at no charge for use in a clinical trial. However, in such cases, the facility must not charge the patient or Medicare for the device. When the facility receives a device at no charge, the facility may bill Medicare for services related to the provision of the device so long as the device meets all other Medicare coverage requirements. Also, the facility must not accept a free device as a condition of doing business with a manufacturer.
DEFINITIONS:
Category A device: An innovative/experimental device for which "absolute risk" of the device type has not been established (that is, initial questions of safety and effectiveness have not been resolved and the FDA is unsure whether the device type can be safe and effective). There is no Medicare coverage, under any circumstances, for a Category A device.
Category B device: A device for which the underlying questions of safety and effectiveness of that device type have been resolved by the FDA, or it is known that the device type can be safe and effective because, for example, other manufacturers have obtained FDA approval for that device type.
Clinical Trial: A formal study, which, once approved by the FDA, permits a sponsor to utilize an investigational medical device for investigation or research purposes using one or more human subjects to determine the safety and/or effectiveness of the device for a certain intended use. Device: For purposes of the FDA process, refers to an instrument, apparatus, implement, machine, contrivance, implant, in vitro reagent, or other similar or related article, including any component, part, or accessory, which is recognized in the official National Formulary, or the U.S. Pharmacopoeia, or any supplement to them; intended for use in the diagnosis of disease or other conditions, or in the cure, mitigation, treatment, or prevention of disease, in man or other animals; intended for use in the diagnosis of conditions other than diseases such as pregnancy; intended to affect the structure or any function of the body of man or other animals; or considered an in vitro diagnostic product, including those previously regulated as drugs, and which does not achieve any of its principal intended purposes through chemical action within or on the body of man or other animals and which is not dependent upon being metabolized for the achievement of any of its principal intended purposes.
Immediately life threatening disease or condition: A stage of a disease in which there is a reasonable likelihood that death will occur within a matter of months or in which premature death is likely without early treatment.
Investigational device: A medical device which is used in a clinical investigation or research using one or more subjects to determine the safety and/or effectiveness of a device for a specific application or intended use.
Investigational device exemption (IDE): An application which, when approved by the FDA, permits an investigational device (Category A or B), which would otherwise be subject to marketing clearance, to be shipped lawfully for the purpose of conducting a clinical trial in accordance with federal regulations.
510(k) or PMN: A Premarket Notification (PMN or 510(k)) to determine “substantial equivalence.” Device manufacturers submit a PMN or 510(k) application to the FDA when they intend to introduce a device into commercial distribution for the first time or reintroduce a device that will be significantly changed or modified to the extent that its safety or effectiveness could be affected. Such change or modification could relate to the design, material, chemical composition, energy source, manufacturing process, or intended use. The FDA then determines whether the device is equivalent to a device already approved or whether a further study or evaluation is required including the need for an IDE.
Related services (services related to): All services furnished in preparation for the use of an investigational device, services furnished contemporaneously with and necessary to the use of an investigational device, and services furnished as necessary aftercare that are incident to recovery from the use of the device. For example, a surgical procedure to implant an investigational hip implant is considered a related service.
PROCEDURE:
1.Each facility’s IRB is responsible for approving the use of all investigational devices within the facility. Either the facility’s administrative representative on the IRB and/or the clinical department involved in the delivery of services involving investigational devices must obtain the following information regarding the device and clinical trial:
Name of Device (trade name, common/usual name and classification name);
Narrative description of the device;
Name of device manufacturer;
The clinical trial protocol;
Total clinical trial enrollment population (Number of patients and number of facilities participating nationally);
Local clinical trial enrollment population (Number of patients participating locally);
IRB Authorization/Approval Letter;
A copy of the IRB-approved informed consent and the protocol for obtaining the patient’s informed consent specific to the clinical trial;
FDA letter approving trial, including IDE number;
Action taken to conform to applicable FDA controls (if applicable);
Statement indicating how the device is similar to and/or different from other comparable device(s) (if applicable); and
Statement attesting to the presence or absence of any marginal costs to Medicare associated with the clinical trial.
2.After IRB approval and prior to providing services, the facility’s administrative representative on the IRB or clinical department involved in delivery of services involving investigational devices must notify the Business Office/Service Center of the IRB’s approval of the investigational device clinical trial. A copy of the FDA approval letter with the IDE categorization (i.e., Category A or B) and number must also be provided to the Business Office/Service Center.
3.The facility must notify their Medicare Fiscal Intermediary (FI) prior to submitting claims for Category B devices and related services, as well as covered services related to the provision of Category A devices. A letter similar to Attachment A must be sent to the FI, accompanied with the required documentation. If all other coverage requirements have been met, it is appropriate to bill Medicare as the Medicare FI may not provide an acknowledgement or response to the facility’s notification letter.
4.Facility personnel must verify that all investigational devices utilized in the facility chargemaster are assigned to “Revenue code 624 – Investigational Device,” regardless of Medicare coverage.
5.Non-covered investigational devices (Category A or Category B) and related non-covered services may be charged to a patient only if proper notice was provided to the patient prior to receiving such services. Medicare beneficiaries must be issued a Hospital Issued Notice of Non-Coverage (HINN) for non-covered inpatient services or an Advance Beneficiary Notice (ABN) for non-covered outpatient services. Reference the Advance Beneficiary Notice Policy, REGS.GEN.003, for additional information regarding ABNs.
6.Business Office/Service Center personnel must verify that edits have been established in the electronic billing system to identify claims for Medicare beneficiaries which include revenue code 624.
a)For Category B devices covered by Medicare, the UB-92 must include the following:
- The FDA-approved IDE number in FL 43 on the line item including revenue code 624; and
- The charges for the investigational device and related services in FL 47 (Total Charges).
- Condition code 30 (Qualifying Clinical Trials) in FL 24-30.
- The FDA-approved IDE number in FL 43 on the line item including revenue code 624.
- Modifier QV (Item or service provided as routine care in a Medicare qualifying clinical trial) in FL 44 of outpatient claims on the line items with HCPCS codes that include covered related services.
- The charges for the Category A device in FL 47 (Total Charges) as well as FL 48 (Non-covered Charges).
- The charges for the related services in FL 47 (Total Charges).
- ICD-9-CM diagnosis code V70.7 (Examination of participant in clinical trial) as a secondary or subsequent diagnosis code in FL 67. Note: ICD-9-CM codes may only be assigned by an individual designated as a coder; billers may not perform this function.
i)If proper notice was not provided to the patient prior to receiving the device, report the charges for the investigational device and related services on the UB-92 as follows:
- Outpatient claims: The charges for the investigational device and related services must be removed from the UB-92.
- Inpatient claims: The charges for the investigational device and related services must be reported in FL 47 (Total Charges) as well as FL 48 (Non-covered Charges). Occurrence span code 76 must be reported in FL 36 of the UB-92 indicating the dates of service for which the facility is liable under the waiver of liability provision.
Outpatient claims: The charges for the investigational device and related services must be reported in FL 47 (Total Charges). Occurrence code 32 must be entered in FL 32-35 indicating the date that the ABN was provided to the beneficiary. The GA modifier must be appended to the codes for the device and CPT/HCPCS code for the related services for which an ABN was obtained.
Inpatient claims: The charges for the investigational device and related services must be reported in FL 47 (Total Charges) as well as FL 48 (Non-covered Charges). Occurrence span code 77 must be reported in FL 36 of the UB-92 indicating the dates of service for which the patient is liable under the waiver of liability provision.
7.All staff associates involved in the delivery of services involving investigational devices and/or related services, or in the preparation or submission of claims for reimbursement from Medicare, must be educated on the contents of this policy.
8.Business Office/Service Center personnel must identify any specific instructions from their Medicare FI and notify the Regs Helpline of any FI interpretations which vary from the interpretations in this policy. Specific documentation from the intermediary related to the variance(s) must be obtained and provided to the Regs Helpline.
The Facility Ethics and Compliance Committee is responsible for implementation of this policy within the facility.
REFERENCES:
42 CFR Parts 405 and 411
42 CFR §412.42
Medicare Benefit Policy Manual (CMS Pub. 100-2), Chapter 14 – Medical DevicesMedicare Coverage Policy – Clinical Trials
Department of Health and Human Services (DHHS) Memo from Thomas A. Ault,
December 28, 1994
Food, Drug, and Cosmetic Act (21 U.S.C. 360c)
32 CFR §199.4
FDA ( “Device Advice”
FDA Guidance for Institutional Review Boards and Clinical Investigators 1998 Update, Medical
Devices
FDA Guidance for Institutional Review Boards and Clinical Investigators 1998 Update, “Off-Label”
Use of Marketed Drugs, Biologicals and Medical Devices
Advance Beneficiary Notice Policy, REGS.GEN.003
HCA Quality Management Institutional Review Board Policies
Riverbend GBA, Medi-Letter 1041-01
United Government Services Medicare Bulletin 402
FloridaHospital Association Compliance Alert, February 21, 2003
CMS Manual System, Pub. 100-20 One-Time Notification, Transmittal 131, Change Request 3548, December 17, 2004
Medicare National Coverage Determinations Manual, Chapter 1, Part 4, Section 310
Medicare Claims Processing Manual, Chapter 3, Section 130.5; Chapter 25, Section 60; and Chapter 30
2/2006
Hospital Name
Street
City, State Zip Code
Medicare Provider: XX-XXXX
Medicare Fiscal Intermediary
Attn:
Street
City, State Zip Code
RE: XYZ Device Clinical Trial
Dear ______;
ABCHospital will be participating in the FDA approved clinical trial for XYZ device. In (Month, Year), the FDA approved the XYZ device to be used in clinical trials. In its consideration, the FDA designated the XYZ device as Category B. (Please refer to the attached approval letter(s) from the FDA.) As such, this device is eligible for coverage and reimbursement by Medicare.
(Insert brief synopsis of clinical trial.)
The clinical trial protocol allows for enrollment of XXX patients at up to XX institutions. We anticipate enrollment of up to X patients, however the Sponsor has not limited the individual site enrollment.
Enclosed please find the following documentation regarding the trial for your review:
- Name of Device (trade name, common/usual name and classification name)
- Narrative description of the device
- Name of device manufacturer
- Overview of the clinical trial
- Total clinical trial enrollment population (Number of patients and number of facilities participating nationally)
- Local clinical trial enrollment population (Number of patients participating locally)
- Institutional Review Board (IRB) Authorization/Approval Letter
- Protocol for obtaining the patient’s informed consent specific to the clinical trial
- FDA letter approving trial
- FDA letter granting IDE number (if applicable)
- Action taken to conform to applicable FDA controls (if applicable)
- Statement indicating how the device is similar to and/or different from other comparable device(s) (if applicable)
- Statement attesting to the presence or absence of any marginal costs to Medicare associated with the clinical trial
Should you have any questions or require any additional information, please contact me at XXX-XXX-XXXX.
Sincerely,
Attachment to REGS.BILL.007